R. Independent Perspective | Real-World Solutions

September 23, 2015

U.S. Department of Labor

Employee Benefits Security Administration
Public Disclosure Room

200 Constitution Avenue, NW, Suite N-1515
Washington, DC 20210

Re: Proposed Conflict of Interest Rules

Ladies and Gentlemen:

Manning & Napier Advisors has a long history of providing investment advice to plan
sponsors and retirement-oriented investment products in a fiduciary capacity. Throughout the 45
year history of our firm, we have done so in an attempt to provide prudent investment services
and investor education that are intended to produce successful retirement outcomes. As a
pioneer of life cycle investing, we have done so through a number of different market
environments and a marketplace that continues to dramatically evolve over time. In response to
the proposed rules released by the Employee Benefits Security Administration on April 14, 2015,
we respectfully submit the following comments.

Given our long-standing fiduciary history as an independent registered investment
advisor, we have watched as a number of other types of professional organizations are now
marketing their services as “advisory” while often not being actual registered investment
advisors. To the extent an organization is purporting to provide advisory services to a retirement
plan, it is appropriate that it be held to the common standard of behavior currently applicable to
plan fiduciaries. In furtherance of this, we feel that requiring an advisor to acknowledge its
fiduciary status in writing would be an important step.

We also feel that any rulemaking should duly consider potential consequences in the
marketplace beyond the actions required by the proposed rule itself. The impact of unintended
consequences of promulgated rules, particularly with those rules that have been implemented in a
compressed time frame, can be negative and should be avoided. As such, rules that could result

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R. Independent Perspective | Real-World Solutions

in fewer service providers in the smaller plan market segment should be implemented in a
deliberate manner. This would allow for an appropriate amount of analysis to be given to the
impact in the marketplace.

Similarly, we are very concerned that the proposed rules could meaningfully, and
negatively, impact participant education. According to a 2011 study by DALBAR, Inc. of
individual investor behavior, actual investor experience in equity mutual funds drastically
underperformed that of the S&P 500 (3.83% vs. 9.14% annualized returns) during the 1991-2010
time period. Moreover, combined with subpar saving behaviors, the current defined contribution
framework is not producing the retirement readiness that it should. Investment results that are
far below market averages, combined with chronic under saving by participants, will not produce
a workforce that is capable of retiring when it makes the most sense for our economy.
Ultimately, new rules that serve to de-link actual investment options on a plan’s menu from the
investment education being provided to participants would be a meaningful disservice to the
nation’s participants.

In conclusion, Manning & Napier believes that creating a level playing field for standards
of conduct among advisors to retirement plans is an important and appropriate objective. That
said, the DOL should be very deliberate and focused in its rule-making process in order to avoid
steps that could provide further impediments to participants’ ability to achieve their long-term
financial goals for retirement including further limitations in the smaller plan marketplace and
constraints on permissible investment education to plan participants.

Very truly yours,

Kichoya®B es | cs
Richard B. Yates

Chief Legal Officer
Manning & Napier Advisors